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Wednesday, April 20, 2016

KUALA LUMPUR: Malaysia Airlines Bhd CEO and managing director Christoph Mueller will leave his executive position in September 2016.

Khazanah Nasional Bhd, which is the sole shareholder of the airline, said on Tuesday it was informed by the MAB board of directors about Mueller's intention to leave.

“The matter has also been discussed and recorded at the Khazanah board of directors meeting earlier today.

“While we would have wanted Mueller to continue as planned, we also respect and ultimately agree to his decision to leave ahead of the end of his three-year contract, due to a change in his personal circumstances,” it said.

To recap, German-born Mueller is the first non-Malaysian at the helm of the national carrier.

MAB took off on Sept 1 last year by taking over Malaysian Airline System Bhd operations, including assets and liabilities.

In an interview with AP early April, Mueller said MAB posted a profit in February - its maiden positive monthly result - and it was on track to return to profitability by 2018.

“For a company that lost RM2bil just last year, if you are able to break even for a month or so, it means the financial gap between revenue and cost has significantly closed, and that is good news that tells us that we are on the right trajectory,” he said in an interview.

Below is the statement issued by Khazanah:

Khazanah Nasional Berhad (“Khazanah”) has been informed by the Malaysia Airlines Berhad (“MAB”) Board of Directors that CEO and Managing Director Christoph Mueller will leave his executive position in September 2016. The matter has also been discussed and recorded at the Khazanah Board of Directors meeting earlier today.

While we would have wanted Mr. Mueller to continue as planned, we also respect and ultimately agree to his decision to leave ahead of the end of his three-year contract, due to a change in his personal circumstances.

Khazanah would like to thank Mr. Mueller for his instrumental contribution in the restructuring efforts, all the while demonstrating strong performance as the person tasked with implementing the turnaround of the national carrier and developing talent for eventual local succession.

We note that Mr. Mueller has laid the groundwork, put in place a strong management team, and undertaken the necessary measures and initiatives that have produced encouraging signs of progress on Malaysia Airline’s path to recovery, as called for under the five-year 12-point MAS Recovery Plan (“MRP”).

We also record our appreciation for Mr. Mueller’s commitment to facilitate an orderly transition by serving the full six-month notice period as CEO to September 2016, and beyond that, for his commitment to remain on the MAB Board as Non-Executive Director to see through the leadership transition and continue contributing to the implementation of MRP.

Khazanah as the sole shareholder of MAB will, in consultation with the MAB Board and the Government, through the Minister of Finance, undertake the succession planning for the new CEO of MAB.

In accordance with the provisions of and conditions contained in the MRP, the final decision on the new CEO of MAB will be undertaken through all necessary consultation and approvals before the end of Mr. Mueller’s term in September 2016.

Khazanah notes the implementation of the MRP is on track and on schedule over the 20-month period since its announcement in August 2014.

Much has been achieved over this period and Mr. Mueller has contributed significantly to its progress to date.

He has also helped to lay the foundations for a sustained turnaround and in that regard, Khazanah will continue to support and drive the recovery further in the remaining 40 months of the MRP.

Indonesian airline Garuda has signed a 4 billion pound ($5.75 billion) deal with planemaker Airbus and engine-maker Rolls-Royce to upgrade 14 A330 aircraft to the newer A330neo version of the jet, the British government said.

The deal was signed on Tuesday in London on the first day of Indonesian President Joko Widodo's visit to Britain, and announced by Downing Street in a statement which said it would boost Britain's economy .

The wings for Airbus planes are made in Britain and UK firm Rolls-Royce will make and service the engines for the jets.

The A330neo is a more fuel-efficient version of the Airbus A330 long-distance jet with new Trent 7000 engines from Rolls-Royce launched in 2014.

Airbus has told aircraft industry experts that it expects to win 700 orders this year. According to sources, Airbus executives mentioned the target at a meeting of aircraft value appraisers in Toulouse last week.

In its latest official guidance, parent Airbus Group says it expected orders to exceed deliveries of more than 650 aircraft in 2016.

Airbus sold a gross total of 32 aircraft and delivered 125 in the first quarter, down 74 percent and 7 percent respectively from the same period last year. After adjusting for cancellations, it posted 10 net orders in the quarter, its slowest start to the year since 2011.

According to the media reports, the airline is expected to be cost effective.

Aiming to provide low cost air transport, Saudi Arabian Airlines ( Saudia) has announced the establishment of a new airline company, named Flyadeel. According to the media reports, the airline is expected to be cost effective.

Earlier in December, Director General of Saudia Saleh Al-Jasser had said that despite the SR30 increase in the airfares, the airliner's ticket prices are lowest. With the total catalogue value of$ 8.0million, 50 passenger planes from Airbus were ordered by Saudia during the 2015 Paris Air Show.

RayaniAir has suspended its operations temporarily in order to restructure the airline's management. The airline, in a Facebook posting said: “Hello, RayaniAir Operations has temporarily been suspended in order to restructure its management. We apologise for the inconvenience..”

Rayani Air pilots had reportedly gone on strike on Thursday causing the cancellation of several flights.